Are you eligible for bankruptcy?
An application for bankruptcy is a big decision to make and so we recommend that you always take time to also consider other debt solutions too, such
as an Individual Voluntary Arrangement (IVA) or a Debt Management Plan (DMP).
Even though bankruptcy wipes your debts and lets you start fresh once it’s finished, there are other debt solutions that might be worth considering.
Can I go bankrupt?There is criteria you would have to meet to be able to qualify for bankruptcy, such as
1. You must be a resident of England, Northern Ireland or Wales.If you live in Scotland you should look into Sequestration, which is the country’s equivalent of bankruptcy.
2. You can afford the upfront fee of £680 to apply for a bankruptcy orderThese fees must be paid and so you need to find this money before making your application – there are some charities and grants that can help you, if you meet the criteria for this. These fees can be made in instalments but the application won’t be completed until the full payment has been received.
What happens when I apply for bankruptcy?Your application for bankruptcy is sent to the Adjudicator; they decide if you satisfy the conditions for bankruptcy. The Adjudicator has 28 days to review your application and make their decision.
If the Adjudicator thinks you meet the requirements listed above, they’ll send your application to an Official Receiver. This person will then take control of your bankruptcy and also any assets you may have.
It’s really important that you carefully consider whether you meet the requirements to apply for bankruptcy. For some people there could be a more suitable option.
When should I look into other debt solutions?We recommend that another debt solution is considered, if any of the following applies:
- If you have at least £50 in disposable income – another debt solution could be a better option.
- If you work in the financial sector – if you have been declared bankrupt some professions won’t allow you to continue working for them. Check your employee handbook or contract before making your application.
If you’d like to talk to PayPlan regarding debt advice, speak to one of our team today by calling 0800 316 1833.